Flow Chart, Treatment of Anxiety Disorders

Why Psychologists Should Care About Outcome Measurement

HIPAA Update: Security Rule

HIPAA and Standards
of Encryption

Childrens' Rights to Confidentiality of
Treatment Records and Interaction with HIPAA

Professional Liability
Insurance: Chapter 3,
"The Paper Office"

Professional Liability
Insurance: "Shopping Tips"

Professional Will

Responding to a
Subpoena

"As psychologists we need to be leading the way or our way will be made for
us by others who do not understand what we do or our model of care and
do not have our interests at heart.”

It is no secret that making a go of it in the private practice of psychotherapy is tough. There has been a dramatic increase in the number of psychologists not to mention other disciplines (social work, counseling, nursing) entering the field in the last quarter century. At the same time practitioners’ incomes have gone down. Medications have come to play an increasingly large role in mental health treatment (increasing by 17% a year between 1991 and 2001 from 7 to 21% of all mental health costs) while payments to non-medical providers have declined during that same period from 9 to 8 %. The oversupply of practitioners has caused psychologists to diversify their practices to stabilize their incomes. Still many psychologists continue, and indeed, will continue, to derive part of their income from managed care insurance.

As is well-known, in the early days of managed behavioral health care (the decade of the 1980s), carve out MCOs took an active role in reining in utilization. “Medical necessity” was the concept MCOs used to justify their restrictive utilization and treatment decisions. Medical necessity is a widely used term in healthcare. In general medicine, the definition of medically necessary treatment is often quite clear. Indications for admission for an appendectomy or normal childbirth, for instance, have a high degree of consensus. But for psychiatric illness where there are no external biological validators—where the disorder is subjectivity itself--there is considerably more ambiguity. Because the term is not objective, i.e. quantified and highly specific, and because MCOs are incentivized to lower utilization and increase profits, the utilization decisions MCOs make are often biased toward the least costly option. In other words, care management is easily conflated with cost management to the detriment of patients.

That was then. There are indications that the industry is changing rapidly and for the better. First, “carve-out” MCOs are in a state of contraction. Magellan, the nation’s largest MCO with almost 60 million covered lives, is losing its largest customer, Aetna, and is about to lose substantial Blue Cross contracts as well. Second, and most importantly, MCOs are beginning to operationally define such terms as medical necessity using quantifiable, transparent, and scientifically credible terms. In addition, care management practices are increasingly informed by such approaches as well. The emerging behavioral health management model is more consensual, more data based and thus more mature.

In healthcare in general and behavioral healthcare in particular, MCOs and Medicare have begun to move to an outcomes based management model. In behavioral health, MCOs have begun to use outcomes instruments to identify “high value” clinicians. Value is a simple equation: improvement divided by cost. High value clinicians are those that produce better than average improvement in their patients (outcomes) at lower cost (i.e. fewer sessions). By profiling their clinicians MCOs can identify those who offer the best value. They then are in a position to use their call centers to refer patients to these preferred providers.

Pacificare Behavioral Health is the first behavioral MCO to successfully implement such an outcomes management program. Using outcomes data derived from two widely used instruments the OQ 30 and the YOQ 30, they have been able to show significant variation among providers in outcome and efficiency. One discovery was that that multidisciplinary group practices achieve better outcomes more efficiently than do solo practitioners. The accompanying graph shows the difference in effectiveness between group and solo practitioners.

Effectiveness Variation OQ-30 and YOQ-30 used to track treatment response > 17,000 cases 2,800 solo providers & 58 groups 170% greater effect size for groups Not explained by diagnosis, severity or provider type p < .00001

Groups also differ from solo practitioners in efficiency. Note that Pacificare data show that more effective clinicians achieve their results in fewer sessions.

Efficiency Variation Better results of groups are achieved with fewer sessions 25% difference p < .01

A fundamental interest of an MCO is in return-on-investment, i.e. getting the most bang for the health care buck. MCOs that profile their providers and then refer to those practitioners with the highest value scores can cut costs and boost outcomes, i.e. enhance value, for the population they serve. Because psychologists tend to practice solo or in small non-multidisciplinary groups, it is important for them to insure that their outcomes are not adversely affected by resource factors such as lack of ready availability of medication, convenient appointment times, and the like.

Another important issue for psychologists to be mindful of is case mix. Multidisciplinary group practices often get the more severe patients. More severe patients on average make significantly greater progress than patients who are less severe (effect size for severe adults averages around .90; for mild adults .18). As a result practitioners who see more severe patients have better outcomes. In other words, the better outcomes achieved by multidisciplinary group practices cited above might well be accounted for on the basis of case mix alone. Or take another example: a psychologist whose practice is made up of primarily chronic, disabled patients is not likely to have very good outcomes, if the comparison group is made up of patients who are not chronic and disabled. It is important therefore that any profiling employed by a third party use valid case mix adjustment formulae to insure fair comparisons.

MCO’s use of outcomes is at present mainly focused on profiling — to get a snapshot of their network at a point in time. Pacificare, for instance, does not routinely provide feedback to clinicians. However, an important use of outcomes is to actually improve the outcomes of individual patients while they are still in treatment as well as provide a means for clinicians to enhance their skills. Lambert has shown in five controlled studies that clinician’s who get real time feedback about the adequacy of their patient’s response to treatment are able to improve the outcomes of that subset of patients of more severe patients who are at risk for a poor outcome.

Impact of Feedback on Outcome – Controlled Studies OQ-45 used to track response to treatment Alerts lead to better outcome (p < .05) Alerts lead to more treatment for more severely disturbed (p < .001) Alerts lead to .39 effect size outcome improvement

CarePaths has data from naturalistic settings that shows that clinicians achieve better results the longer they practice with feedback. The following graph is based on the results of 50 clinicians who treated 1590 cases.

Regional and national outcomes initiatives in behavioral health care are emerging and it behooves psychologists to get ahead of this movement. The benefits are many.

• Psychologists can use outcomes to evaluate their practice and improve their performance. This will enhance their ability to compete in an outcomes informed marketplace. They will be able to use outcomes to market their practices to MCOs and other payors based on data and value.
  
  
• Psychologists can insure that outcomes are used not simply as a management control system designed to squeeze a few more dollars out of the clinical enterprise, but as a patient improvement initiative. Outcomes are covered under the ethical use of tests. Outcomes data must be used to further the best interests of patients, not simply the bottom line of the MCO. Thus clinicians using an MCO’s outcomes system can demand that they, and not just the MCO, be provided with test results in real time and in aggregate report.
  
  
• Psychologists need to be vigilant about the use of data by MCOs, especially the conflation of marketing and research. Outcomes initiatives need to be monitored for scientific integrity and fairness. Psychologists must insist that the instruments used meet our profession’s standards for psychometric integrity and that case mix adjustment inform our understanding of quality performance.
  
  
• Organizations such as Division 42 are in a position to create a Practice Research Network (PRN). A PRN can demonstrate to payors the effectiveness and efficiency of psychological care. It can provide clinicians with benchmarking data with which to self-regulate, optimize performance and identify best practices. Psychologists can use a PRN as the organizing vehicle to create risk taking treatment systems.

Dr. Gray is President of CarePaths, Inc., a privately held behavioral informatics company owned principally by psychologists. CarePaths has created Internet applications, including a behavioral electronic medical (or health) record (EMR) with an electronic claims module, Assessment and Outcomes Management System, and Behavioral Disease Management System for behavioral/primary care integration. Taking advantage of the Internet, these applications require no investments in expensive software and are immediately ready for use. Current system users include universities, medical centers, NHS (Great Britain), Department of Defense, and others. CarePaths has established PRNs for national organizations including the Association of Directors of Psychology Training Clinics (see www.adptc.clinicprn.org) and the Outdoor Behavioral Healthcare Industry Council (www.obhic.clinicprn.org).

Dr. Gray may be reached at ggray@carepaths.com.